Ch. 8: Control, Change and Entrepreneurship Flashcards Preview

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Flashcards in Ch. 8: Control, Change and Entrepreneurship Deck (26)
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1
Q

What are control systems?

A

Formal target-setting, monitoring, evaluation, and feedback systems that provide managers with information about how well the organization’s strategy and structure are working.

2
Q

What is feedforward control?

A

Control that allows managers to anticipate problems before they arise.

3
Q

What is concurrent control?

A

Controlthat gives managers immediate feedback on how efficiently inputs are being transformed into outputs so managers can correct problems as they arise.

4
Q

What is feedback control?

A

Control that gives managers information about customers’ reactions to goods and services so corrective action can be taken if necessary.

5
Q

What are the 3 stages of control?

A

Input stage: Feedforward control, anticipate problems before they occur Conversion stage: Concurrent control, manage problems as they occur Output stage: Feedback control, manage problems after they have arisen

6
Q

What are the 4 steps in the organizational control process?

A
7
Q

What are the three organizational control systems?

A
8
Q

What is the return on investment?

A

The net profit of sales before taxes divided by total assets. Measures how well managers are using the organization’s resources to generate profits.

9
Q

What is the operating margin?

A

The total operating profit divided by the sales revenue.

A measure of how much percentage profit a company is earning on sales; the higher the percentage, the better a company is using its resources to make and sell the product.

10
Q

What are the liquidity ratios?

A

The current ratio is the current assets divided by the current liabilities. Do managers have resources available to meet claims of short-term creditors?

The quick ratio is the current assets minus the inventory divided by the current liabilities. Can managers pay off claims of short-term creditors without selling inventory?

11
Q

What are the leverage ratios?

A

Debt-to-assets ratio: Total debt divided by total assets.

To what extent have managers used borrowed funds to finance investments?

Times-covered ratio: Profit before interests and taxes divided by total interest charges.

Measures how far profits can decline before managers cannot meet interest charges. If this ratio declines to less than 1, the organization is technically insolvent.

12
Q

What are the activity ratios?

A

Inventory turnover: Cost of goods sold divided by inventory.

Measures how efficiently managers are turning inventory over so that excess inventory is not carried.

Days sales outstanding: Current accounts receivable divided by sales for period divided by days in period.

Measures how efficiently managers are collecting revenues from customers to pay expenses.

13
Q

What is an operating budget?

A

A budget that states how managers intend to use organizational resources to achieve organizational goals.

14
Q

How does organizational goal setting work?

A
15
Q

What is management by objectives (MBO)

A

A goal-setting process in which a manager
and each of his or her subordinates negotiate specific goals and objectives for the subordinate to achieve and then periodically evaluate the extent to which the subordinate is achieving those goals.

16
Q

What is bureaucratic control?

A

Control of behavior by means of a comprehensive system of rules and standard operating procedures.

17
Q

What is organizational culture?

A

The set of values, norms, and standards of behavior that control the way individuals and groups interact and work together to achieve organizational goals.

18
Q

What is clan control?

A

The control exerted on individuals and groups by shared organizational values, norms, and standards of behavior.

19
Q

Who is responsible for balancing organizational control and change?

A
20
Q

What is organization change?

A

The movement of an organization away from its present state and toward some desired future state to increase its efficiency and effectiveness.

21
Q

What are the four steps in the organizational change process?

A
22
Q

What is top-down change?

A

A fast, revolutionary approach to change in which top managers identify what needs to be changed and then move quickly to implement the changes throughout the organization.

23
Q

What is benchmarking?

A

The process of comparing one company’s performance on specific dimensions with the performance of other, high-performing organizations.

24
Q

What are entrepreneurs?

A

Individuals who notice opportunities and decide how to mobilize the resources necessary to produce new and improved goods and services.

25
Q

What are intrapreneurs?

A

Employees of existing organizations who notice opportunities to develop new or improved products and better ways to make than.

26
Q

What is entrepreneurship?

A

The mobilization of resources to take advantage of an opportunity to provide customers with new or improved goods and services.